Crompton Greaves Consumer Electricals share price was outperforming the markets on Friday, March 6. The stock of the consumer electricals and household appliance company rose nearly 1 per cent over its previous close, bouncing 1.4 per cent from the day's low.
Motilal Oswal Financial Services sees an upside potential of nearly 40 per cent in shares of
Crompton Greaves Consumer Electricals. The domestic brokerage firm maintained its ‘Buy’ rating on the stock with a share price target of ₹350.
The brokerage believes the consumer electricals maker is entering a new growth phase, supported by premiumisation in its core businesses and expansion into new product categories.
Crompton Greaves, the brokerage said, has gradually strengthened its presence across multiple consumer electrical segments and is now positioned to scale beyond its traditional product lines.
“Crompton Greaves Consumer Electricals’ core total addressable market (TAM) -- comprising fans, residential & agri pumps, lighting, and appliances (including kitchen appliances) – stood at ₹77,000 crore. However, successive entry into solar pumps, rooftop solar, and now residential wires has expanded this TAM to over ₹1.63 trillion, effectively doubling its market opportunity,” Motilal Oswal pointed out.
Why is Motilal Oswal bullish on Crompton Greaves?
Crompton Greaves is the market leader in the ‘Fan’ segment with a 25-per cent market share.
The company is increasingly focusing on premium products such as brushless direct current (BLDC) and high-end induction fans. The share of these premium models in the company’s sales mix has risen meaningfully in recent years.
Motilal Oswal noted that premium fans now contribute around a quarter of the company’s fan portfolio, compared with roughly 12-15 per cent five years ago. The company is targeting a further increase in this share to about 40 per cent over the medium-term.
“Channel checks indicate that retailers and distributors are building inventories ahead of the peak summer season, reflecting improving confidence in demand recovery,” the report said.
Not just higher demand, the company, MOFSL said, is better prepared to handle its unsold inventory amid the transition to stricter energy-efficiency norms for fans under the Bureau of Energy Efficiency (BEE) framework.
It noted that better inventory planning, model changeovers, and dispatch alignment have been executed with better discipline, limiting channel dislocation.
While a significant portion of the excess pre-transition inventory was liquidated during Q3FY26, the residual inventory overhang remains modest and is expected to normalize fully by Q1FY27, the brokerage added.
Motilal Oswal, however, believes the new standards could drive consolidation in the sector.
“The BEE 2.0 energy efficiency mandate represents a structural tailwind for organized players,” the brokerage said, adding that as much as 30-40 per cent of unbranded or semi-branded production may struggle to meet the new norms.
“This could translate into market share gains for established brands such as Crompton Greaves,” MOFSL noted.
Scaling up Solar business
Beyond Fans, the solar business is emerging as a key opportunity over the medium-term for Crompton Greaves. The company is already among the top three players in solar pumps and expects strong demand as farmers gradually replace conventional pumps with solar-powered systems.
On its part, the management estimates that the solar segment could generate around ₹2,000 crore in revenue over the next two to three years.
Foray into Wire business
Meanwhile, Crompton Greaves Consumer, recently, entered the retail wires segment, which Motilal Oswal described as a logical adjacency with a large addressable market.
“While the wires market is crowded and margins could initially act as a drag, the company aims to build a differentiated portfolio centered around product innovation and customer problem-solving,” MOFSL said.
The company aspires to achieve high single-digit Ebit margins in this segment while maintaining disciplined RoCE (return on capital employed), it added.
Crompton Greaves outlook
In this backdrop, Motilal Oswal expects Crompton Greaves to post steady growth in the coming years.
It forecasts a revenue compound annual growth rate (CAGR) of around 8 per cent between FY26 and FY28, while earnings growth could be stronger due to margin improvements.
“We expect Crompton to report a revenue, Ebitda, PAT CAGR of 8 per cent, 14 per cent, and 17 per cent, respectively, over FY26–28,” the brokerage said, adding that Ebitda margin may improve to 10.4 per cent and 11.2 per cent in FY27 and FY28 vs 10.2 per cent in FY26.
Overall, Motilal Oswal believes Crompton’s strong positioning in core categories, combined with new growth engines such as solar and wires, could help the company deliver consistent growth over the next few years.
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